This is because the buyer is responsible for paying the stamp duty and registration charges from his pocket. The ready reckoner rate is also known as the circle rate. Each area inside a city has its own ready reckoner rate on which the particular stamp duty is collected. To meet these twin targets, district administrations are supposed to revise the circle rates periodically. Since this property is in Delhi, Ram will have to pay 6% + 1% as stamp duty and registration charge in Delhi on the transaction. In this context, we talk about circle rates and the impact it has on your property purchase decision. She will also have to pay an additional Rs 15,000 as the registration charge. These rates are applied to the amount at which the property is to be registered. As the gap between the market and guidance value of properties reduces, more genuine buyers would enter real estate. In Delhi’s New Friends Colony, for example, the market rate is lower than the circle rate. Among other things, the circle rate of an area is reflective of its success as a real estate hotspot, as well and would invariably be higher in more coveted residential spots. It is also used by financial institutions to determine the loan quantum when processing a mortgage loan application. As circle rates are not revised as regularly as the market value of properties change, one can see wide gaps between the two across India’s major property markets. Category A - Rs. To legally own a property, a home buyer has to visit the local sub-registrar’s office and get it registered in his name. Since there were no circle rates in Delhi in 2001, the Valuation Report / Certificate will be needed to determine the cost of acquisition / fair market value of property. In Karnataka, circle rates are often referred to as guidance value. Apart from that, “The concept of circle rates came into existence for the first time in 1999 in Bihar. Here’s why Pune cannot afford hiked Ready Reckoner rates. The users should exercise due caution and/or seek independent advice before they make any decision or take any action on the basis of such information or other contents. Considering that the house has a carpet area of 1,000 sq ft and the prevalent circle rates, she would have to register the property for Rs 51 lakhs. All rights reserved. What are market rates and how are they different from circle rates? 136,400 per sq meter; C :: Rs. Market rate is basically the price the seller could ask for his property and the buyers would be willing to pay. In a major trend that is seen in the sector of Indian housing over the past five years, the new data points towards an abridged distinction between the ready reckoner (RR) rates and the real market prices in the principal (sale by the developer) segment in the top cities, said by Anarock in a statement. This is primarily achieved, by levying taxes on various services that they provide to citizens. 2) Pay stamp duty and registration charges on circle rate- Paying stamp duty and registration cost on circle rates can cause huge financial losses. Since they do not really have any black money, they are actually forced to turn their white money into black, to compete the transaction. Number of localities in Varanasi showing an upward trend is 25. Various names are used across India, to denote circle rates. Government bodies have to generate income, in order to function and carry out the activities they are responsible for. When looking to buy a property in Gurgaon, knowing the circle rates is one of the important things which you need to consider. Circle rate refers to the minimum valuation on which land and immovable properties in the city have to be registered with the Government of Haryana. Now, the Haryana government will charge 5% as stamp duty on this amount, since the property is being registered in the name of a woman. It is the system in which government fixes the minimum or maximum rate of the land depending on the category of colonies it falls in and no transaction is allowed below the minimum rate fixed by the government in any area of the city. Agreement value refers to the value that is mentioned in the sale deed. In Mumbai, the average market prices of the commercial property in the Lower Parel are about 6 percent higher at Rs 34,660 per sq ft as compared with the RR(ready reckoner) rate of Rs 32,609 per sq. In Greater Noida’s Alpha 1, the circle rate is Rs 32,000 per sq metre. Find the Stamp duty amount for all states in India towards property documnet registration. According to the latest data for Bengaluru, the market price of commercial property at Rajajinagar is about Rs 13,300 per sq ft as in opposition to the circle rate of Rs 9,012 per sq ft. At Indiranagar, the market rate is about Rs 11,500 per sq ft while the RR(ready reckoner) rate is Rs 10,312 per sq ft. Not only this, but the average market prices of the real estate at Kharadi and Baner in Pune also higher by 7 percent and 10 percent correspondingly than the circle rates in these particular localities. When circle rates are lower than the market rate of a property, this encourages the buyer, as well as the seller, to engage in illegal activities. According to the latest data for Bengaluru, the market price of commercial property at Rajajinagar is about Rs 13,300 per sq ft as in opposition to the circle rate of Rs 9,012 per sq ft. Under this arrangement, the buyer often arranges and pays the differential money in cash. Also known as collector rate or guidance value, circle rate is the price below which a property cannot be registered in the government’s records. Circle rate is the price per unit area that is affixed by government authorities for land or property in a locality, below which property transactions cannot be registered. Lowering circle rates, stamp duty to bode well for residential markets: Report; India set to overtake China as the world's largest LPG residential market by 2030; Delhi ranks 27th, Mumbai 33rd globally as fastest-growing prime residential market: Report; … Circle rates are usually lower than the prevailing market value. Circle rate is guideline value of land / property based on the State government slab. of NCT Delhi. Now, suppose you have brought the property in Sector 30 of Gurugram, an area where the circle rate currently is Rs 5,000. In Feb 2011, government had hiked the circle rates in Delhi by over 100%. 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